Crosswords1 min ago
Property Auctions
I wonder if anyone can help with a property auction query.
At an auction, without instruction from the seller, can the auctioneer bid up the price up to the reserve price when there are actually no bids?
I was under the impression that this was a process of shill bidding and not permitted?
At an auction, without instruction from the seller, can the auctioneer bid up the price up to the reserve price when there are actually no bids?
I was under the impression that this was a process of shill bidding and not permitted?
Answers
1 to 12 of 12
Best Answer
No best answer has yet been selected by wizard. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.
but I am afraid some auctioneers 'run up' the price by pretending that they have a bid when they don't, they to do this when they know the vender and want to get the best price for them, they also 'miss' bids to keep the price low when they know someone that wants it, this happens at all auctions that I have been to, which is quite a few.
@jackthehat
So what makes an auctioneer exempt for shill bidding?
I appreciate that they bid "off the walls" but doesn't this defeat the object of the auction? I.e. wouldn't it be in their interests to lower the bid to the point of a genuine bidder placing a legitimate bid and then go from there?
The fact that two "bidders" have been fighting it out between themselves that didn't actually exist is surely illegal?
So what makes an auctioneer exempt for shill bidding?
I appreciate that they bid "off the walls" but doesn't this defeat the object of the auction? I.e. wouldn't it be in their interests to lower the bid to the point of a genuine bidder placing a legitimate bid and then go from there?
The fact that two "bidders" have been fighting it out between themselves that didn't actually exist is surely illegal?
@jackthehat
It's not in their best interests to start the auction on a fabricated bid and then allow two fabricated bidders to bid against each other because it's never going to sell.
Am I ill-informed to assume they would keep dropping the opening bid until a GENUINE bidder became attracted to it and put in a bid?
It's not in their best interests to start the auction on a fabricated bid and then allow two fabricated bidders to bid against each other because it's never going to sell.
Am I ill-informed to assume they would keep dropping the opening bid until a GENUINE bidder became attracted to it and put in a bid?
Occasionally, the wheels *do* come off, if there is no-one in the room prepared to outbid the 'off the wall' bidders.........at which point the property is generally removed from the Auction.
In such cases, the Auctioneer usually apologises and re-lists it for the next sale waiving any 're-list' fees.......
In such cases, the Auctioneer usually apologises and re-lists it for the next sale waiving any 're-list' fees.......
or it is called taking bids off the wall,
and I thought it as definitely unlawful (out lawed under the same legislation as outlawing dealeres' 'rings' = communal underbidding to defraud the seller )
until I saw a beeb auction program when it was done cheerfully with the auctioneer admitting it.
so it must be lawful
and I thought it as definitely unlawful (out lawed under the same legislation as outlawing dealeres' 'rings' = communal underbidding to defraud the seller )
until I saw a beeb auction program when it was done cheerfully with the auctioneer admitting it.
so it must be lawful
I'd guess that, since the object won't be sold unless the reserve is reached then it isn't so bad as it would be after that limit. If someone is willing to pay the reserve it isn't such a bad thing to encourage them to do so (since they're not going to be allowed to buy it at any lower price) but if they aren't prepared to pay the reserve it has no affect anyway. Ergo no fraud.
It sounds dangerously close to obtaining, or attempting to obtain, money, by deception; the bidder is subject to the dishonest false representation that there is someone else who is wants to buy at the given price. The difficulty is that the house that opens bidding by suggesting a figure, which they all do,is inviting a bid at that price yet nobody has offered it.Nobody could reasonably complain about that. Anyone who bids at it might be the only person in the world who would take the price. It is difficult to distinguish between the two situations.
In addition,with art and and antiques, the major auction houses have a term that the house may bid up any lot in which they have an interest. The interest is not specified, but may be that they have advanced money, against it, to the vendor .
Either way, off the wall or "off the chandelier" (for those who bid in posh places!) bids are common. That's why the old hands stand at the back of the room, leaving dozens of empty seats in front of them. That way, they can see whether there is a bidder. That won't stop the pretence that there are bids "on the book", commission bids submitted and recorded by the house beforehand, but it does help.
I've never heard of a prosecution of a "ring", though there have been for pretend auctions where everything is fraudulent, and the Act must be one of the least used on the statute book.
In addition,with art and and antiques, the major auction houses have a term that the house may bid up any lot in which they have an interest. The interest is not specified, but may be that they have advanced money, against it, to the vendor .
Either way, off the wall or "off the chandelier" (for those who bid in posh places!) bids are common. That's why the old hands stand at the back of the room, leaving dozens of empty seats in front of them. That way, they can see whether there is a bidder. That won't stop the pretence that there are bids "on the book", commission bids submitted and recorded by the house beforehand, but it does help.
I've never heard of a prosecution of a "ring", though there have been for pretend auctions where everything is fraudulent, and the Act must be one of the least used on the statute book.
1 to 12 of 12
